On January 2, 2021, L Co. issued at face value $24,500 of 4% bonds convertible in total into 1,900 shares of L's common stock. No bonds were converted during 2021. Throughout 2021, L had 1,900 shares of common stock outstanding. L's 2021 net income was $6,500. L's income tax rate is 20%. No potential common shares other than the convertible bonds were outstanding during 2021. L's diluted earnings per share for 2021 would be:

Multiple Choice

• $1.71.

• $1.92.

• $1.97.

• $3.42.